Time For PTC To Look Beyond Translarna

Perseverance does not always pay off – just ask PTC Therapeutics (NASDAQ:PTCT). Hopes for its lead product, Translarna, now lie in tatters after another phase III failure in its second indication, cystic fibrosis, which sent its stock down 20% yesterday.

PTC, which has also struggled to get Translarna approved in the US for Duchenne muscular dystrophy (DMD), has now stopped development in cystic fibrosis. According to its website, the asset is still in phase II trials for mucopolysaccharidosis 1, aniridia and Dravet syndrome, but the company did not say whether these would continue. Maybe it is time to give up and focus on the rest of PTC's pipeline (see table below).

This does not seem likely any time soon, though. PTC is still appealing against the FDA’s refuse-to-file letter for Translarna in DMD despite the rejection of its original appeal in October. The company has since said it plans to file an NDA over protest in the first quarter of 2017.

Translarna has conditional approval in the EU in DMD, but a permanent green light is contingent on PTC conducting an additional phase III trial, which is expected to report data by 2021.

Subgroup fail

While the future of Translarna in DMD is still up in the air, its fate in cystic fibrosis has been sealed with the results from the Act CF trial, which missed its primary endpoint of absolute change in FEV1 at 48 weeks versus placebo.

This was in spite of Act CF focusing on a subgroup of patients who seemed to have responded in an earlier failed phase III study, those not receiving chronic inhaled aminoglycosides such as tobramycin. PTC had postulated that tobramycin had interfered with Translarna’s mechanism of action.

The discontinuation in cystic fibrosis wipes $129m off Translarna’s consensus 2022 sales forecast of $405m, according to EvaluatePharma sellside consensus; the rest of these revenues are expected to come in DMD.

The product brought in $81m in 2016, according to preliminary figures, and PTC forecasts 2017 revenues of $105-125m, beating Jefferies analysts’ estimates. But getting it on to the US market in DMD has now become even more important with the cystic fibrosis fail.

Other indications look unlikely to pick up the slack for some time, even if Translarna does manage to show a benefit here. Initial phase II data in mucopolysaccharidosis 1 were expected in 2016, according to Jefferies, but do not seem to have been reported yet, and there also does not appear to be an entry for the study in Clinicaltrials.gov.

Meanwhile, phase II results in aniridia – a disorder in which the iris is absent – and Dravet syndrome are not due until next year.

The company believes that Translarna’s mechanism could address these disparate disorders because it overcomes nonsense mutations that are involved in all of these diseases. These mutations create a premature stop signal when mRNA is being translated, leading to an incomplete, non-functional protein.

However, with mixed results in DMD and the latest failure in cystic fibrosis, whether this works is far from proven.

PTC might be left relying on its earlier-stage pipeline, which comprises RG7916 – a project with Roche being studied in spinal muscular atrophy – and PTC596, which is in phase I in solid tumours. However, the former could be late to the party in an increasingly competitive SMA field, while the latter is still very early. PTC looks like it will have to rely on European DMD sales of Translarna for a while longer.